This study finds that managers take the deviations from their target capital structures into account in planning and structuring acquisitions. Specifically, firms that are overleveraged relative to their target debt ratios are less likely to make acquisitions, are less likely to fund acquisitions with debt, acquire smaller targets, pay lower premiums and receive favorable market reactions to ac...

In this paper, we present a stochastic optimal control model to optimize an insurance firm problem in the case where its cash-balance process is assumed be described by differential equation driven Teugels martingales. Noticing that able dynamics regulating underlying premium rate, aim of policy maker select appropriate order minimize total deviation state some pre-set target level. As part max...

Reliability and efficacy of accruals and cash flows which are among the most important factors affecting dividend deviation have always been in question and subject to anomalies. The presence of these anomalies in accruals and cash flows and its effect on future returns and the consequences that they can have in country’s investments are the main motives to choose this issue for the current stu...

We extend Dechow and Dichev’s [2002] model of current accruals quality (CAQ) to consider total accruals quality (TAQ). While the two measures are conceptually similar (both reflect the standard deviation of the residuals from the mapping of accruals into lead and lag cash flows), they differ in terms of the definitions of accruals and cash flows as well as the number of lead and lag cash flow t...

The role of the medium of exchange in competition among bidders and its effect on returns to stockholders in corporate takeovers are investigated. Consistent with recent empirical evidence, our model shows that stockholders of both acquiring and target firms obtain higher returns when a takeover is financed with cash rather than equity, and that returns to target shareholders increase with comp...

We integrate heterogeneity and uncertainty in investor valuations into a model of takeovers. Investors have dispersed valuations, holding shares in firms they value more highly, and a successful offer must win approval from the median target shareholder. We derive the consequences for an acquiring firm’s takeover offer—its size and cash/equity structure—and implications for takeover premia and ...